Goal started this wednesday new round of layoffs with the aim of restructuring their teams, obtaining greater efficiency and reducing their costs. A total of 10,000 new workers will be fired, and a series of additional cuts scheduled for the month of May.
He goal memo, published by Blomberg, urges team managers to invite American workers to work from home to better accommodate the news of downsizing. The new layoffs will affect all variants of the company, including hardware quest and Reality Labswhich includes the company’s virtual reality projects.
It must be remembered that during the presentation of the company’s results, Mark ZuckerbergCEO of Meta, defended the idea that 2023 would be the year of efficiency and that for this it was necessary reduce hierarchical structure of the different subsidiaries, establishing a more vertical system like the one that prevails on Instagram. The employees who remain in the company will do so under the orders of new managers. “My hope is to make the organic changes as soon as possible to get through this period of uncertainty and focus on critical work,” Zuckerberg said.
This new wave of layoffs follows the one announced at the beginning of November that marked the 13% cut in the workforce (11,000 employees). In the coming months, the managers will announce restructuring plans in different divisions and hiring rates will be reduced. The cuts of the technology divisions will be announced at the end of April and those of the business groups at the end of May, added to the timetable of the affected international teams that could also vary.
Your financial balance
It is a situation of economic recession, a banking crisis and a state of emergency for the technology sector, although in Wall Street has been viewed favorably rebound Meta shares up to 4.77% at the opening of the session.
In early February, Meta reported that it had obtained a net profit of 23.2 billion dollars (21,725 million euros) in 2022, a drop of 41% compared to the figures of the previous year. Regarding their annual income, these were 1.1% less than in 2021; 116,609 million dollars (109,197 million euros).
Meta’s financial director, Susan Liwas optimistic for 2023 and expects first-quarter total revenue to be close to $28.5 billionwhile expenses will range between 89,000-95,000 million dollars, a lower figure than the estimate prior to the announcement of new layoffs, which was 94,000-100,000 million dollars.
The announcement of new cuts in Meta will that up to 5,000 vacancies remain unfilledcanceling a large number of projects qualified as ‘non-priority’. In Zuckerberg’s own words, the goal is to become a better technology company, executing this new long-term course. His objective is to analyze his hybrid work mode during the summer to further adjust both costs and efficiency.
No more trying to sell the metaverse
The Facebook founder has faced a lot of criticism in recent weeks from Meta shareholders for his decision to invest in the Metaverse, which led the company to lose 12,500 million euros.
Layoffs affect Reality Labs because it is proving investment bottomless pit. In the fourth quarter of 2022, losses amounting to 4.280 million dollars, which follows the 3,300 million of the previous quarter. However, improved forecasts and cost cutting helped its shares rise by 20% gradually.
In terms of income, this division of Meta has generated 660 million euros in the last quarter, something that has led shareholders to demand an urgent restructuring and that Zuckerberg gave up his blind faith towards Reality Labs, which accumulates 20% of the expenses and more than 18,000 employees. However, this division reports just over 2% of the company’s revenue.
A few months ago the news spread that not even the Meta employees themselves used Horizon Worlds, the group’s flagship metaverse app, due to design issues with it. This platform for building and interacting in virtual worlds does not work by itself. poor graphic qualityand although attempts have been made to force employees to use it, it does not fit.
As published The InformationMeta no longer introduces the concept of the metaverse to its advertisers during meetings, instead placing greater emphasis on the use of reels and to AI tools. To do this, it offers discounts up to 25% if you invest in reels and drive Advantage+, a program that uses machine learning to serve ads to every user on Meta platforms. It is curious that in October there was talk of the need to invest in the metaverse and that now, within its strategy of ‘Year of efficiency’ It is a concept that is barely named.
Not only Meta is affected by the serious crisis affecting the technology sector, increased by the increase in the price of money by the Federal Reserve and high inflation. Thus, companies like Disney, Amazon or Twitter have been forced to lay off more than 150,000 workers in 2022according to data from the portal layoff.fyi.
